AU Optronics Corp. (AUO, ??), one of Taiwan's leading flat panel makers, said on Thursday that it made a profit in the third quarter of this year on the back of a recovery in product prices, following three consecutive loss making quarters.
In the July-September period, AUO said it posted NT$4.62 billion (US$146 million) in net profit, compared with a net loss of NT$804 million in the second quarter. In the third quarter net profit rose 36.6 percent from the same period last year.
In the third quarter, AUO's earnings per share (EPS) stood at NT$0.51, compared with the NT$0.06 loss per share seen in the second quarter and NT$0.36 in EPS registered in the third quarter of last year.
Third quarter results were released after the local equity market closed on Thursday. During the trading session, shares in AUO fell 1.91 percent to close the day at NT$12.85 on the Taiwan Stock Exchange as investors locked in earlier gains posted due to hopes of a better bottom line for the flat panel supplier.
AUO said the third quarter was traditionally peak season for the global flat screen industry, boosting demand and sending product prices higher. According to the company, the average sales price for the third quarter rose from US$340 to US$372 per square meter in the second quarter.
Due to the rebound in product prices, AUO's sales for the third quarter rose 7.4 percent year-on-year to NT$86.02 billion. The firm's gross margin for the July-September period grew from 6.9 percent to 13.1, while its operating margin rose from 0.1 percent to 6.7 percent.
AUO said efforts had been made to improve the company's product portfolio by including more value added products to boost the profit margin in the third quarter. As a result, operating profit for the July-September period rose 69.7 percent from a year earlier to NT$5.76 billion.
In the third quarter, shipments of AUO's large-sized panels totaled 29.27 million units, up 2.8 percent from the second quarter, while the company shipped 37.97 million units of medium and small-sized screens in the third quarter, down 10.6 percent from the previous quarter. Large sized screens usually carry a higher price tag and command a higher profit margin.
At an investor conference held on Thursday, AUO Chairman Paul Peng (???) said that although the fourth quarter is traditionally a slow time for the industry, demand remains strong. Production capacity at AUO is already fully booked, he added.
Peng said that due to solid demand, AUO expects growth momentum to continue into the fourth quarter, riding the wave of an uptrend in product prices. He said it is very possible the company will continue to report a profit for the current quarter.
Looking ahead, Peng said that he is upbeat about the market outlook for the first half of next year.
Source: Focus Taiwan News Channel